With US first quarter GDP figures revealing weaker growth than anticipated the US Dollar has fallen against several of its most traded peers, including the Euro, Yen and British Pound.
The Japanese Yen broadly strengthened during local trade as the Bank of Japan opted to maintain its current stimulus methods but made no hint that further steps might be taken to bring persistent deflation to an end.
The British Pound strengthened considerably against the US Dollar yesterday after UK GDP modestly exceeded expectations and has retained gains during the European session.
The US Dollar Exchange Rate was trading in the region of 98.2100 against the Japanese Yen as of 14:25 GMT
Economists envisaged the US economy growing by 3 per cent in the first three months of this year, following growth of 0.4 per cent in the fourth quarter.
However, while consumer spending enjoyed its most significant increase since 2010, a slump in defence spending meant that the world’s largest economy only grew by 2.5 per cent in the third quarter.
According to Commerce Department figures the 2.5 per cent annual rate expansion was driven by advances in residential construction and a 3.2 per cent increase in household consumption – the biggest gain for two years.
The rise in household consumption was accompanied by a fall in the saving rate, which dipped from 4.7 per cent to 2.6 per cent.
Prior to the report’s release one US economist stated: ‘There are ebbs and flows but the overall picture is one of a moderately growing economy. We’ll see a bit of tailing off this quarter.’
In the aftermath of the data the Dollar Index fell for a second day, slipping 0.3 per cent. The index is used as a means of tracking the US Dollar’s performance against its main currency rivals, including the Yen and Euro.
In response to the figures foreign-exchange strategist Charles St-Arnaud noted: ‘Investors have been concentrating a lot on headline numbers, which are confirming that the government sector is being a drag on the economy. But we haven’t reached a threshold where it’s extremely weak, which would cause a flight to safer assets.’
Current US Dollar Exchange Rates
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The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6857 <
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7679 <
The US Dollar/Australian Dollar Exchange Rate is currently in the region of: 0.9733 <
The US Dollar/Japanese Yen Exchange Rate is currently in the region of: 98.2100 <
The US Dollar/Canadian Dollar Exchange Rate is currently in the region of: 1.0202 >
(Correct as if 14:25 GMT)
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